What is a distressed hedge fund

Hi everyone,

I am new to this message board and this is my first posting. I would like to know what a distressed hedge fun is and does. Could anyone explain to me or give me links to good sources of information?

Thank you very much.

3 Comments
 

as far as i know, this characterizes the hedge funds of today. Hedge funds are like mutual funds, but with different investor and investing rules. Typically, hedge funds deal more with alternative financial instruments like derivatives and commodities as opposed to bonds and equities. But distressed hedge funds specialize in distressed securities, which are basically things like junk bonds i.e. high-risk, high-yield investments. The Goldman Sachs Global Situations Group deals with alot of distressed debt.

 

well a hedge fund with a distressed strategy is one that seeks out near bankrupt or in trouble companies that it feels are valued well below the actual value of the company. they look at the intrinsic value and take advantage of the company's troubles by buying at a lower price

 

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